Facilitating trade in Indian ports

Importance of Indian Port

• The Indian port sector plays a vital role in sustaining growth in the country's trade and commerce.
• It also has an important role in fulfilling India's dream of achieving greater global engagement and integration with its trading partners.
• Much of India's port-led development initiative is expected to revolve around growth in maritime trade, given its share in terms of both volume and value in the country's overall trade statistics.

Initiatives taken by Government to strengthen this sector

• Development of new ports
• Modernisation and mechanisation of the existing ports,
• Reduction of logistics costs through the implementation of increased waterways transport.
• These are also in line with the vision of initiatives such as ''Make in India''.

Issues faced by various ports

• Seaports displayed specific patterns of issues based on differences in geography, infrastructural capacity, operational aspects, contractual arrangements, and so on.
• Haldia Port, West Bengal, being a riverine port, faces the natural challenge of heavy siltation and inadequate dredging capacities.
• In Paradip Port, Odisha, there is issue of semi-mechanisation and manual handling of critical processes having a cascading effect on overall operational efficiency. It highlights the importance of complete mechanisation of processes to ensure seamless operations and thereby lower down vessel turnaround time.
• Congestion at the approach roads is a common problem observed at the Jawaharlal Nehru Port in Maharashtra.
• Underutilisation of physical infrastructure in particular though is extremely prevalent at another private terminal — the Vallarpadam International Container Transhipment Terminal — at the Cochin Port.

Bolstering prospective ventures

As India eyes a resurgence in port-led activities in the country, these issues, though specific to certain ports, indicate the need for the Central government to undertake measures to facilitate trade through Indian ports, either in terms ofbuilding and maintaining infrastructurefor handling desired capacities or undertaking relevantpolicy and regulatory reforms.

For Infrastructure

• It is important to maintain draft to serve bigger vessels
• Ensure mechanisation of ports through introduction of new equipment and procedures
• Build new facilities
• Upgrade existing facilities
• Automate systems/procedures.

For policy and regulatory reforms

• It is important to streamline tariff determination by TAMP along with a provision for periodic revisions
• Ensure transparent and effective contractual arrangements in PPPs
• Implement strengthened communication platforms for seamless information flow among stakeholders
• Strengthen system integration
• Ensure paperless clearance of procedures and transactions
• Develop user information portals

Conclusion

• Apart from reviving the ports currently operational, these measures, if duly incorporated, promise to sufficiently bolster prospective ventures as the country moves towards an optimistic maritime trade regime.

Centre's nod for NIMZ in Medak

The government has granted the final approval to the National Investment and Manufacturing Zone (NIMZ) at Zaheerabad in Medak district, Telangana.

The estimated total investment by the manufacturing industry by the end of the ultimate phase of the NIMZ's development is Rs.17,300 crore and the employment generation is about 2.77 lakh.

What are National Investment and Manufacturing Zones (NIMZs)?

1. The National Investment & Manufacturing Zones (NIMZs) are an important instrumentality of the National manufacturing policy. The NIMZs are envisaged as integrated industrial townships with:
2. State of the art infrastructure.
3. Land use on the basis of zoning.
4. Clean and energy efficient technology.
5. Necessary social infrastructure.
6. Skill development facilities etc.

Aim: NIMZs aim to provide a productive environment for persons transitioning from the primary to the secondary and tertiary sectors.

What the National Manufacturing Policy (NMP) says?

The National Manufacturing Policy (NMP) has the objective of enhancing the share of manufacturing in GDP to 25% and creating 100 million jobs over a decade. The NMP provides for promotion of clusters and aggregation, especially through the creation of national investment and manufacturing zones (NIMZ).

The National Manufacturing Policy (NMP) provides for:

• Relief from Capital Gains Tax on sale of plant and machinery of a unit located in a National Investment and Manufacturing Zone (NIMZ) in case of re-investment of sale consideration within a period of three years for purchase of new plant & machinery in any other unit located in the same NIMZ or another NIMZ.
• Rollover relief from long term Capital Gains tax to individuals on sale of a residential property (house or plot of land) in case of re-investment of sale consideration in the equity of a new start-up SME company in the manufacturing sector for the purchase of a new plant and machinery.
• Simple and expeditious exit mechanism for closure of sick units while protecting labour interests.
• In respect of environmental laws/regulations, inspection by specially trained/designated/notified agencies for third party inspection to supplement the inspection by the Government agencies for compliance monitoring.

Some notable points:

• NIMZ can be proposed with land area of at least 5000 hectares.
• Land will be selected by state governments and preference would be given to uncultivable land.
• NIMZ will be managed by Special Purpose Vehicle, headed by. Govt. officials and experts, including those of environment.
• To enable NIMZs to function as self governing autonomous bodies, they will be declared by the state government as industrial townships under Article 243 Q (c) of the constitution.
• NIMZs will be notified by the central government.